Campaigner John Carson, a civil engineer and former director of maintenance at Network Rail,said: “The cost of the project will undoubtedly go over £1billion.

“When you take interest on funding into account, it will hit around £1.3billion.

“The project has been out of control for years and it still is.

“They are three-quarters of theway through the budget with almost nothing to show for it.

“The only finished article is the depot in Gogar and some trams.

“There is about 100 metres of finished line in the west end. The project is nowhere close to finality.

“There has been no substantial work at York Place, where they have decided to build a new tram stop.

“I have 40 years’ experience in construction and if this was my project, I would be extremely worried. The problem is that someof the people who have been in charge of the project were guisingas construction people.

“Some of them know nothingabout creating a tram network.There is no responsibility and no accountability.

“Edinburgh is going to go bust when the trams start running and making losses. School budgets and other public transport systemswill suffer as a result.”

In September, councillors agreeda new budget of £776million for the scheme – originally meant to cost £345million – after a catalogue of blunders and routes being axed.

Around £70million has been spent in the last three months alone and the total so far is £592million.

If it continues at the same rate for the rest of this year, spending would reach £802million – plus another £280million next year.

The two figures combined would take the project above £1billion – making it the world’s most expensive transport scheme per mile.

The outlook is even more grim if £228million in interest on a 30-year loan to cover a funding shortfall is taken into account.

The project also has a £34million “contingency fund” to dip into.

Lesley Hinds, Labour’s transport spokeswoman at Edinburgh City Council, said: “Having the projectrun over £1billion is a distinctpossibility when you consider what has happened in the past.

“The scheme is millions of pounds over budget with only half a line to show for it, and it is years behind.

“The people of Edinburgh will be ashamed at the money that has been spent and the damage to the city’s reputation. It’s an embarrassment. We keep getting assurances from officials that the project will stay within its new budget but I am very cynical about it.

”The additional money which is now going to be spent on tramscould have been better spent onthe city’s schools, care homes and sports pavilions, which are in apoor condition.”

The former Lord Provost saidthe city’s SNP and Lib Demadministration were to blame forthe scheme spiralling out ofcontrol in the last five years and vowed that Labour would “takethe project by the scruff of theneck” if they are elected in May.

He said: “We must not be under any illusion that this project will remain at £776million.”

The project wasoriginally awarded £375million from the Scottish Executive in 2003.

There were initially plans for three tram lines but one of them, to the south of the city, was scrapped.

Two tram lines were supposed to be complete by 2009.

But the second tram line, linking Granton and Haymarket, was also shelved.

By 2008, the overall budget had leapt to £545million.

A dispute betweentram bosses TIE and contractors Bilfinger Berger stalled construction for a year amid claimsthat the builders were asking for more money. The row over who should pay for delays saw theestimated cost of the scheme rocket to £776million in September.

Taxpayers across Scotland are paying £500million, with the rest paid by Edinburgh City Council.

The Scottish Government stepped in to insist their transport agency take over the project.

The council had already admitted the remaining line would stop at the city centre instead of going through Leith to the waterfront.

It will not be ready until 2014.

A trams spokesman said the £1billion estimate had “no substance” and that the costs of work would not be the same every quarter.

He added: “Work continues to progress well along the full length of the route from the airport to St Andrew Square and in line with the revised programme published in December.

“Overall, we remain on course to deliver the project within the revised budget by summer 2014.”